History of Sears
In 1886 , Richard Sears, an agent of the Minneapolis and St. Louis railway station in North Redwood, Minnesota, started a watch company named R.W. Sears Watch Company. After Richard Sears received an unexpected shipment of watches from a jeweler, he in turn sold the watches for a higher price and received a significant return. R.W. Sears Watch Company was originally located in Minneapolis, Minnesota but later expanded to Chicago in 1887. (http://www.searsarchives.com/history/)
In 1893, after the partnership of Richard Sears and Alvah C. Roebuck, Sears, Roebuck and Company was formed. Unfortunately, due to personal conflicts and differing opinions pertaining to financial risks, the partnership ended and Sears returned back …show more content…
Ultimately, this has led to inadequate or low compensation being offered to many of their client facing employees and the difficulty caused in the funding their pension plan. Many will argue that Sears will almost be extinct and will most likely have to file bankruptcy in order to reverse the damage, while others will disagree. Together, we will explore some solutions that may help to relieve some of their issues with their compensation.
Issue of Inadequate Compensation
In July 2013, several employees protested in front of Sears located in Chicago, Illinois demanding higher wages and better hours. Sears has consistently reported negative operating and revenue profits for the last three fiscal years. Given this information, it is highly unlikely that workers will receive a substantial amount in increased wages.
Conversely, their competitor Wal-Mart has the cash flow to offer a small raise to some of their employees who are earning minimum wage. In their current financial state, Sears will not be able to compete given their negative net income records reported over the past few years. Sears would have to terminate some of their employees if they were to compete with Wal-Mart’s …show more content…
In order to close the gap between workers and top executives, regulating chief executive pay would be the most essential way for Sears to recoup of some of their losses. Furthermore, this may also allow Sears to offer their low wage earners a slight increase in their salaries and could better fund their pension fund.
It is suggested that the compensation of an average worker only fluctuated to 10 percent while the compensation for chief executives fluctuated to about 937 percent between the years of 1978 through 2013. The theory behind executive compensation is that they should earn more because they are more skilled at their jobs and they are the top leaders within their organizations.
Recently in the news, Dan Price, the CEO and founder of Gravity Payments, reduced his million dollar salary to $70,000 per year. He was able to do this because he taking his salary from the firm’s annual revenue of two million in profits. Because of this, he was able double the salaries of thirty of his employees while providing significant raises to the other forty employees. According to Dan Price, he will continue to reduce his salary for the next two to three years until he can restore Gravity’s
In 1886 , Richard Sears, an agent of the Minneapolis and St. Louis railway station in North Redwood, Minnesota, started a watch company named R.W. Sears Watch Company. After Richard Sears received an unexpected shipment of watches from a jeweler, he in turn sold the watches for a higher price and received a significant return. R.W. Sears Watch Company was originally located in Minneapolis, Minnesota but later expanded to Chicago in 1887. (http://www.searsarchives.com/history/)
In 1893, after the partnership of Richard Sears and Alvah C. Roebuck, Sears, Roebuck and Company was formed. Unfortunately, due to personal conflicts and differing opinions pertaining to financial risks, the partnership ended and Sears returned back …show more content…
Ultimately, this has led to inadequate or low compensation being offered to many of their client facing employees and the difficulty caused in the funding their pension plan. Many will argue that Sears will almost be extinct and will most likely have to file bankruptcy in order to reverse the damage, while others will disagree. Together, we will explore some solutions that may help to relieve some of their issues with their compensation.
Issue of Inadequate Compensation
In July 2013, several employees protested in front of Sears located in Chicago, Illinois demanding higher wages and better hours. Sears has consistently reported negative operating and revenue profits for the last three fiscal years. Given this information, it is highly unlikely that workers will receive a substantial amount in increased wages.
Conversely, their competitor Wal-Mart has the cash flow to offer a small raise to some of their employees who are earning minimum wage. In their current financial state, Sears will not be able to compete given their negative net income records reported over the past few years. Sears would have to terminate some of their employees if they were to compete with Wal-Mart’s …show more content…
In order to close the gap between workers and top executives, regulating chief executive pay would be the most essential way for Sears to recoup of some of their losses. Furthermore, this may also allow Sears to offer their low wage earners a slight increase in their salaries and could better fund their pension fund.
It is suggested that the compensation of an average worker only fluctuated to 10 percent while the compensation for chief executives fluctuated to about 937 percent between the years of 1978 through 2013. The theory behind executive compensation is that they should earn more because they are more skilled at their jobs and they are the top leaders within their organizations.
Recently in the news, Dan Price, the CEO and founder of Gravity Payments, reduced his million dollar salary to $70,000 per year. He was able to do this because he taking his salary from the firm’s annual revenue of two million in profits. Because of this, he was able double the salaries of thirty of his employees while providing significant raises to the other forty employees. According to Dan Price, he will continue to reduce his salary for the next two to three years until he can restore Gravity’s